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Funeral business turns in papers Gap in trust fund remains unknown By DAVID PRESZLER EUGENE -- The Kern Family Services' bankruptcy case inched forward Tuesday. The troubled funeral service company submitted a revised disclosure statement and Chapter 11 reorganization plan to creditors' attorneys Tuesday, but no significant process was made in the complicated case. Dan Isard, president of Kern's management company, said the plan is expected to be accepted by the court Feb. 22 if all the involved entities -- major creditors' representatives, state and IRS officials -- sign off on it. Isard also said the company will not seek permission to sell either its Grants Pass- or Medford-based businesses until the plan is approved. Kern Family Services operates the Perl group of businesses in Medford and similar business in Grants Pass that include Hull & Hull Funeral Home, Hawthorne Memorial Gardens and Southern Oregon Cremation Services. Although a new plan has been drafted, the sides in the bankruptcy are still working to nail down the crucial question: How much is missing from a trust fund for prepaid funeral and burial services? More than 3,600 customers paid into the fund. Initial reports from a mediator placed the figure at $4 million to $5 million, but the mediator now says that as much as $6.9 million may need to be repaid, Isard said. Isard's company disputes that figure. By his calculations, $4.7 million is needed to replenish the fund and only $4 million should come from the Kern family. Isard says the remaining $700,000 is owed by Service Corporation International, the former owner of the Perl group. Isard said he will meet Monday with representatives from the mediator, Portland-based American Funeral and Cemetery Trust Services, to settle the discrepancy. "It will be resolved," said Isard. He said the state attorney general's office representative, Susan Egnor, will also attend. Egnor could not be reached for comment. Chuck and Shirley Kern, founders of Kern Family Services, have agreed -- and the court has ordered them -- to pledge the net value of the businesses and of their personal property to cover whatever repayment the court orders. The formal disclosure statement and reorganization plan will be sent to individual creditors for approval after the court has accepted it. Because the document will be around 50 pages, Isard said individual customers who bought burial plans would not receive a complete copy. Those customers, represented by Eugene attorney Douglas Schultz, will get a short version written in plain language that outlines how the fund will be repaid. Prepaid customers have continued to be serviced while the bankruptcy issues are resolved and the company has said none of them will lose any money. Mail Tribune Copyright � The Mail Tribune 1999, Medford, Oregon USA